According to the Small Business Administration, companies that can qualify for the 7a SBA loan must meet certain small business size standards. These standards vary greatly by industry, but the general rules of thumb are as follows:
Farming businesses must not have revenues exceeding $750,000
Building contractors can have a maximum revenue of $14,000,000
Retail and service businesses can have maximum revenue of $7,000,000
Heavy construction trades and industries have maximum revenues of $33,500,000.
Additionally, there are headcount tests regarding the number of people that work for your business. For wholesale trade industries, the maximum number of employees is 100 while manufacturing firms can have a maximum of 500 employees. However, these rules are not hard and steadfast. The SBA and its associated lenders understand that revenues can fluctuate as can the personnel summary of your firm. As such, it is imperative that you speak to you 7a SBA loan representative to determine whether or not your meet the standards discussed above. However, as many entrepreneurs seek to use this type of credit facility for starting a new business then the standards discussed above typically do not apply to your business. If your business becomes highly successful and requires additional capital then you may start to require traditional business loan financing rather than debt through programs like the SBA 7a Loan.
It should also be noted that based on inflation and industry trends, the Small Business Administration regularly reviews and updates its business eligibility standards based on revenues and personnel numbers of businesses across a number of different industries. If you are having trouble determining whether or not your existing business qualifies for a 7a SBA loan then you should speak directly to a SBA representative, your banker, or your accountant.
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